US Securities Industry Association: "Current US Interest Rate is the Peak... Will Be Lowered" (Summary)

Amid growing uncertainty over additional interest rate hikes in the United States, a U.S. financial market expert has diagnosed that interest rates will be maintained at the current level before being lowered.

Peter Mattison, Executive Director of the Securities Industry and Financial Markets Association (SIFMA), stated on the 20th at the 'International Council of Securities Associations (ICSA) International Conference' held at the Four Seasons Hotel Seoul, hosted by the Korea Financial Investment Association, that "78% of U.S. economic experts expect the Federal Reserve's (Fed) benchmark interest rate to rise to 5.00?5.25% and then decline thereafter."

Considering that the Federal Open Market Committee (FOMC) maintained the benchmark interest rate at 5.00?5.25% during its regular meeting on the 14th (local time), this forecast suggests that the current rate will be maintained without further hikes before eventually being lowered.

Mattison said, "The U.S. financial market has recovered more resiliently than expected, but the situation remains very uncertain due to the upcoming U.S. presidential election next year," adding, "The U.S. GDP growth rate for next year is expected to be 1.7%, and inflation is projected to be 3.0% at both the end of this year and next year."

He further noted, "Decisions related to interest rates will be made in a manner consistent with the economic situation," and added, "Many economists believe a recession is imminent."

The International Council of Securities Associations (ICSA), an international organization for the development of international capital markets, held its annual general meeting over three days from the 18th to today. The first and second days of the meeting were conducted in closed sessions.

On the third day, the conference themed "Preparing for the Future of the Financial Industry" prominently covered technological innovations in the financial investment sector such as artificial intelligence (AI), big data, security tokens (ST), virtual assets, and regulatory trends in various countries.

Brian Passcoe, Chairman of the International Capital Market Association (ICMA), said, "The international financial market has experienced instability due to the pandemic, war, and bank failures, and it is necessary to utilize technological innovation as a means to reduce market risks," emphasizing, "Above all, transparency in the market must be enhanced through collaboration between market participants and regulators."

Discussions and sharing of related cases also continued regarding the simplification of listing laws and the expansion of research on small and medium-sized enterprises to supply venture capital (funds invested in promising venture companies).

Jonathan Bock, CEO of Blackstone Business Development Company (BDC), analyzed, "BDC investments are concentrated in direct lending (DL) worth about 1.5 trillion won, but the potential scale is close to 4 trillion dollars, indicating high growth potential."

Additionally, Jonathan Dix, Chief Investment Officer (CIO) of Octopus Investments, introduced that Venture Capital Trusts (VCT), products investing in venture capital, have become very popular among general investors in the UK as tax-advantaged products, explaining, "Companies receiving VCT investments have grown, creating positive effects such as generating employment for more than 70,000 people."

Furthermore, discussions were held on improving vulnerabilities in the global bond market, structural reforms in the domestic corporate bond market, and pension systems in various countries.

Seo Yoo-seok, Chairman of the Korea Financial Investment Association, said, "The association hosted the ICSA annual general meetings in 1997 and 2008," adding, "Both occasions coincided with global financial crises, and through the annual meetings, we gained global insights on crisis response and created opportunities to overcome the crises."

He added, "Our capital market has always turned crises into opportunities for continuous development," expressing hope that "this conference will serve as a catalyst to overcome the current crisis and advance to the next level."

Lee Bok-hyun, Governor of the Financial Supervisory Service, said in his welcoming remarks, "The capital market is currently at a turning point where threats and opportunities coexist," and expressed hope that "the global securities industry will demonstrate dynamism and creativity, while regulatory authorities will listen carefully to the constructive opinions discussed today and actively support a sustainable future for the capital market."

Meanwhile, the conference featured congratulatory remarks from Baek Hye-ryun, Chair of the National Assembly's Political Affairs Committee; Lee Bok-hyun, Governor of the Financial Supervisory Service; Kim Jeong-gak, Standing Member of the Financial Services Commission's Securities and Futures Commission; and Oh Se-hoon, Mayor of Seoul (via video). Domestic and international experts presented and discussed various issues including the digital and tech revolution, virtual asset markets, successful venture capital supply systems in advanced global markets, diversification trends in trading platforms (ATS, internal order execution, STO, etc.), and global asset management market trends centered on lifelong income and retirement pensions.

This content was produced with the assistance of AI translation services.